2013 IRS News

This page contains announcements from the IRS that are important to tax practitioners. The most recent announcements are listed first.

May 16, 2013 — Refunds for cancelled RTRP test appointments

From the IRS Website:

Fee amounts collected for scheduled registered tax return preparer test appointments canceled due to the court ordered injunction are being refunded. Additionally, fees collected from return preparers who tested on or after January 18, 2013, the date the test was enjoined, are also being refunded. No additional refund or reimbursement requests related to registered tax return preparer regulation are being provided or considered at this time. E-mail notifications will be provided to those receiving refunds to explain the process. No action is necessary to receive the refund. A credit for the test fee will automatically be made to the account used to pay the fee. It is anticipated that all refunds will be processed by July 19, 2013.

Please review our Frequently Asked Questions and continue to check this site for additional information as it becomes available.

Background

On Friday, Jan. 18, 2013, the United States District Court for the District of Columbia enjoined the Internal Revenue Service from enforcing the regulatory requirements for registered tax return preparers. In accordance with this order, tax return preparers covered by this program are not required to complete competency testing or secure continuing education. The ruling does not affect the regulatory practice requirements for CPAs, attorneys, enrolled agents, enrolled retirement plan agents or enrolled actuaries.

On Friday, Feb. 1, the court modified its order to clarify that the order does not affect the requirement for all paid tax return preparers to obtain a preparer tax identification number (PTIN). Consistent with this modification, the IRS has reopened the online PTIN system.

We remain confident in our legal authority and committed to protecting taxpayers through implementing reasonable standards in the tax preparation area. Our appeal of the district court opinion was filed on Mar. 29, 2013.

May 13, 2013 — IR-2013-49: Many Tax-Exempt Organizations Must File with IRS By May 15 to Preserve Tax-Exempt Status

WASHINGTON — A key deadline of May 15 is facing many tax-exempt organizations that are required by law to file annual reports with the Internal Revenue Service. Organizations will see their federal tax exemptions automatically revoked if they have not filed reports for three consecutive years.

The Pension Protection Act of 2006 mandates that most tax-exempt organizations file annual Form 990-series informational returns or notices with the IRS. Under this law, organizations that fail to file reports for three consecutive years automatically lose their federal tax-exempt status. The law, which went into effect at the beginning of 2007, also imposed a new annual filing requirement on small organizations. Churches and church-related organizations are not required to file annual reports.

Form 990-series information returns and notices are due on the 15th day of the fifth month after an organization’s fiscal year ends. Organizations that need additional time to file may obtain an extension.

Many organizations use the calendar year as their fiscal year, which makes May 15 the deadline for them. Organizations that fail to file annual reports for three consecutive years will see their tax exemptions automatically revoked as of the due date of the third required filing.

Small tax-exempt organizations with average annual receipts of $50,000 or less may file an electronic notice called a Form 990-N (e-Postcard), which asks organizations for a few basic pieces of information. Tax-exempt organizations with average annual receipts above $50,000 must file a Form 990 or 990-EZ, depending on their receipts and assets. Private foundations file a Form 990-PF.

The IRS began to publish the names of organizations identified as having automatically lost their tax-exempt status for failing to file annual reports for three consecutive years. Organizations that have had their exemptions automatically revoked and wish to have that status reinstated must file an application for exemption and pay the appropriate user fee.

The IRS offers an online search tool, Exempt Organizations Select Check, to help users more easily find key information about the federal tax status and filings of certain tax-exempt organizations, including whether organizations have had their federal tax exemptions automatically revoked.

May 6, 2013 — Online PTIN System Enhancements

We've made a number of improvements to your online PTIN Account to expand its functions:

• "Manage My Account" is fully functional allowing you to self-correct almost any field at any time (including professional credentials.) Previously, users could only make most changes during renewal. A phone call was required to make changes during the rest of the year. However, for security reasons, name changes will still require written documentation.
• You can now view completed continuing education programs reported by IRS-approved providers beginning with 2013 courses. Providers report completed CE programs to the IRS based on your PTIN number every quarter. Enrolled agents must have a minimum of 16 CE hours annually and a total of 72 hours over 3 years. Others can also view voluntary programs completed. If something is missing, contact your provider directly as we only display what providers send to us.
• Planning to take a year off for any reason? A new function allows you to inactivate your PTIN voluntarily and then reactivate the same number when you return to work. This is only for those of you who plan to take a full year off. If you are paid to prepare tax returns during any part of a year, you must have a valid PTIN.
• Finally, we're enhancing our messaging ability. PTIN holders will receive more secure email messages in the future coming directly from TaxPro_PTIN@irs.gov.

We hope you find these changes helpful. Stay tuned for more enhancements in the future.

May 3, 2013 — TD 9617: Updating of Employer Identification Numbers

The IRS has issued final regulations that require any person assigned an employer identification number (EIN) to provide updated information to the IRS in the manner and frequency prescribed by forms, instructions, or other appropriate guidance. These regulations, which are effective May 6, 2013, affect persons with EINs and will enhance the IRS's ability to maintain accurate information as to persons assigned EINs.

February 12, 2013 — Incorrectly Filled Schedules 8812 Causing Downstream Processing Delays

Following is the text of a QuickAlert released Monday:

We have observed instances in which the Schedule 8812 is attached to form 1040 and 1040A and is not filled out correctly. These instances are causing downstream processing delays. We have experienced the following two conditions: (1) The Schedule 8812 Part 1 checkboxes A, B, C, and D are checked when taxpayers list a dependent child with an SSN qualifying for child tax credit and (2) The Schedule 8812 Part 1 checkboxes A, B, C, and D not being checked when taxpayers have a child with an ITIN (Individual Taxpayer Identification Number) on Form 1040 and 1040A line 6c identified as qualifying for the child tax credit in column 4.

The Schedule 8812 instructions direct the taxpayer to:

"Use Part I of Schedule 8812 to document that any child for whom you entered an ITIN on Form 1040, line 6c; Form 1040A, line 6c; or Form 1040NR, line 7c; and for whom you also checked the box in column 4 of that line, is a resident of the United States because the child meets the substantial presence test and is not otherwise treated as a nonresident alien."

We are working to implement Business Rules to reject these incorrectly completed returns with a date to be determined. In the interim, we request that software packages include an alert to help preparers identify inconsistencies when completing the Schedule 8812 and that communication be provided to the practitioner community to avoid delays in processing returns.

February 11, 2013 — IR-2013-18: IRS To Accept Tax Returns with Education Credits, Depreciation Next Week

WASHINGTON — The Internal Revenue Service announced today that taxpayers will be able to start filing two major tax forms next week covering education credits and depreciation.

Starting Sunday, Feb. 10, the IRS will start processing tax returns that contain Form 4562, Depreciation and Amortization. And on Thursday, Feb. 14, the IRS plans to start processing Form 8863, Education Credits.

This step clears the way for almost all taxpayers to start filing their tax returns for 2012. These forms affected the largest groups of taxpayers who weren’t able to file following the Jan. 30 opening of the 2013 tax season.

The IRS will be able to accept the education credits and depreciation forms following the completion of reprogramming and testing of its systems.  Work continues on preparing IRS systems to accept the remaining tax forms affected by the American Taxpayer Relief Act (ATRA) enacted by Congress on Jan. 2.

The IRS also announced today it will start accepting the remaining forms affected by the January legislation the first week of March.  A specific date will be announced later. Most of those in this group file more complex tax returns and typically file closer to the deadline or obtain an extension. A full list of the forms that will be accepted the first week of March is available on IRS.gov.

Next week's opening covers two groups of taxpayers using:

• Form 8863, Education Credits. Form 8863 is used to claim two higher education credits -- the American Opportunity Tax Credit and the Lifetime Learning Credit.
• Form 4562, Depreciation and Amortization. Most of the people using the depreciation form tend to file later in the tax season or obtain a six-month extension. Non-1040 business filers using Form 4562 can also file starting Sunday.

For taxpayers using e-file, most software companies are now accepting tax returns with these two forms and will submit them after the IRS begins accepting them next week.

More information is available on IRS.gov.

February 4, 2013 — PTIN System Now Open

On Friday, Jan. 18, 2013, the United States District Court for the District of Columbia enjoined the Internal Revenue Service from enforcing the regulatory requirements for registered tax return preparers. In accordance with this order, tax return preparers covered by this program are not required to complete competency testing or secure continuing education. The ruling does not affect the regulatory practice requirements for CPAs, attorneys, enrolled agents, enrolled retirement plan agents or enrolled actuaries.

On Friday, Feb. 1, the court modified its order to clarify that the order does not affect the requirement for all paid tax return preparers to obtain a preparer tax identification number (PTIN). Consistent with this modification, the IRS has reopened the online PTIN system.

The IRS continues to have confidence in the scope of its authority to administer this program and is working with the Department of Justice to address all options, including a planned appeal.

February 1, 2013 — IRS Will Accept Many of the 2012 Tax Year Corporate, Partnership and Tax Exempt Organization Income Tax Returns Beginning Monday Feb. 4

Effective at 9:00 am, Eastern on Monday, February 4th, the IRS will begin accepting many of the TY 2012 calendar and fiscal-year Corporate (Form 1120 series), Partnership (Forms 1065/1065-B), and Tax Exempt Organization (Form 990 series) income tax returns with the exception of filers claiming depreciation deductions and various energy and business tax credits. The IRS plans to accept the remaining tax returns in late February or early March.

In general, this means any business attaching Form 3800 (General Business Credits), Form 4562 (Depreciation and Amortization) or any of the other forms listed below, should wait to file their 2012 tax return at the later date. A specific date will be announced in the near future.

Forms on hold:

• Form 3800 General Business Credit
• Form 4136 Credit for Federal Tax Paid on Fuel
• Form 4562 Depreciation and Amortization (Including Information on Listed Property)
• Form 5471 Information Return of U.S. Persons With Respect to Certain Foreign Corporations
• Form 5735 American Samoa Economic Development Credit
• Form 5884 Work Opportunity Credit
• Form 6478 Credit for Alcohol Used as Fuel
• Form 6765 Credit for Increasing Research Activities
• Form 8820 Orphan Drug Credit
• Form 8834 Qualified Plug-in Electric and Electric Vehicle Credit
• Form 8844 Empowerment Zone and Renewal Community Employment Credit
• Form 8845 Indian Employment Credit
• Form 8864 Biodiesel and Renewable Diesel Fuels Credit
• Form 8874 New Markets Credits
• Form 8900 Qualified Railroad Track Maintenance Credit
• Form 8903 Domestic Production Activities Deduction
• Form 8908 Energy Efficient Home Credit
• Form 8909 Energy Efficient Appliance Credit
• Form 8910 Alternative Motor Vehicle Credit
• Form 8911 Alternative Fuel Vehicle Refueling Property Credit
• Form 8912 Credit to Holders of Tax Credit Bonds
• Form 8923 Mine Rescue Team Training Credit
• Form 8932 Credit for Employer Differential Wage Payments
• Form 8936 Qualified Plug-in Electric Drive Motor Vehicle Credit

Filing of two other business forms is affected by the delay, but only for electronic filers. Businesses using Form 720 and filling out lines 13 and 14 cannot file yet electronically, but they can file on paper. Other Forms 720 are being accepted electronically. In addition, Form 8849 Schedule 3, Claim for Refund of Excise Taxes, is not currently being accepted electronically, but it can be filed on paper.

January 28, 2013 — IR-2013-10: IRS To Accept Returns Claiming Education Credits by Mid-February

WASHINGTON — As preparations continue for the Jan. 30 opening of the 2013 filing season for most taxpayers, the Internal Revenue Service announced today that processing of tax returns claiming education credits will begin by the middle of February.

Taxpayers using Form 8863, Education Credits, can begin filing their tax returns after the IRS updates its processing systems. Form 8863 is used to claim two higher education credits — the American Opportunity Tax Credit and the Lifetime Learning Credit.

The IRS emphasized that the delayed start will have no impact on taxpayers claiming other education-related tax benefits, such as the tuition and fees deduction and the student loan interest deduction. People otherwise able to file and claiming these benefits can start filing Jan. 30.

As it does every year, the IRS reviews and tests its systems in advance of the opening of the tax season to protect taxpayers from processing errors and refund delays. The IRS discovered during testing that programming modifications are needed to accurately process Forms 8863. Filers who are otherwise able to file but use the Form 8863 will be able to file by mid-February. No action needs to be taken by the taxpayer or their tax professional. Typically through the mid-February period, about 3 million tax returns include Form 8863, less than a quarter of those filed during the year.

The IRS remains on track to open the tax season on Jan. 30 for most taxpayers. The Jan. 30 opening includes people claiming the student loan interest deduction on the Form 1040 series or the higher education tuition or fees on Form 8917, Tuition and Fees Deduction. Forms that will be able to be filed later are listed on IRS.gov.

Updated information will be posted on IRS.gov.

January 25, 2013 — Form Availability (Follow-up from January 24 NPL Meeting)

For taxpayers who can file their individual income tax returns beginning January 30, all forms and instructions needed have been posted to IRS.gov at this URL: apps.irs.gov/app/picklist/list/formsPublications.html.

Some 2012 tax forms that cannot be filed beginning on January 30 are not yet available. We continue to work as quickly as possible on updates and will post them on IRS.gov as updates are completed:

/www.irs.gov/uac/Newsroom/List-of-IRS-forms-that-1040-filers-can-begin-filing-in-late-February-or-into-March-2013

January 16, 2013 — IR-2013-6, Tax-Free Transfers to Charity Renewed For IRA Owners 70½ or Older

WASHINGTON — Certain owners of individual retirement arrangements (IRAs) have a limited time to make tax-free transfers to eligible charities and have them count for tax-year 2012, the Internal Revenue Service said today.

IRA owners age 70½ or older have until Thursday, Jan. 31 to make a direct transfer, or alternatively, if they received IRA distributions during December 2012, to contribute, in cash, part or all of the amounts received to an eligible charity.

The American Taxpayer Relief Act of 2012, enacted Jan. 2, extended for 2012 and 2013 the provision authorizing qualified charitable distributions (QCDs)—otherwise taxable distributions from an IRA owned by someone, 70½ or older, paid directly to an eligible charitable organization. Each year, the IRA owner can exclude from gross income up to $100,000 of these QCDs. First available in 2006, this provision had expired at the end of 2011.

The QCD option is available regardless of whether an eligible IRA owner itemizes deductions on Schedule A. Transferred amounts are not taxable and no deduction is available for the transfer. QCDs are counted in determining whether the IRA owner has met his or her IRA required minimum distributions for the year.

For tax-year 2012 only, IRA owners can choose to report QCDs made in January 2013 as if they occurred in 2012. In addition, IRA owners who received IRA distributions during December 2012 can contribute, in cash, part or all of the amounts distributed to eligible charities during January 2013 and have them count as 2012 QCDs.

QCDs are reported on Form 1040 Line 15. The full amount of the QCD is shown on Line 15a. Do not enter any of these amounts on Line 15b but write "QCD" next to that line. Details are on IRS.gov.

January 15, 2013 — IR-2013-5 and Rev. Proc. 2013-13; IRS Announces Simplified Option for Claiming Home Office Deduction Starting This Year; Eligible Home-Based Businesses May Deduct up to $1,500; Saves Taxpayers 1.6 Million Hours A Year

IR-2013-5, Jan. 15, 2013

WASHINGTON — The Internal Revenue Service today announced a simplified option that many owners of home-based businesses and some home-based workers may use to figure their deductions for the business use of their homes.

In tax year 2010, the most recent year for which figures are available, nearly 3.4 million taxpayers claimed deductions for business use of a home (commonly referred to as the home office deduction).

The new optional deduction, capped at $1,500 per year based on $5 a square foot for up to 300 square feet, will reduce the paperwork and recordkeeping burden on small businesses by an estimated 1.6 million hours annually.

"This is a common-sense rule to provide taxpayers an easier way to calculate and claim the home office deduction," said Acting IRS Commissioner Steven T. Miller. "The IRS continues to look for similar ways to combat complexity and encourages people to look at this option as they consider tax planning in 2013."

The new option provides eligible taxpayers an easier path to claiming the home office deduction. Currently, they are generally required to fill out a 43-line form (Form 8829) often with complex calculations of allocated expenses, depreciation and carryovers of unused deductions.  Taxpayers claiming the optional deduction will complete a significantly simplified form.

Though homeowners using the new option cannot depreciate the portion of their home used in a trade or business, they can claim allowable mortgage interest, real estate taxes and casualty losses on the home as itemized deductions on Schedule A. These deductions need not be allocated between personal and business use, as is required under the regular method.

Business expenses unrelated to the home, such as advertising, supplies and wages paid to employees are still fully deductible.

Current restrictions on the home office deduction, such as the requirement that a home office must be used regularly and exclusively for business and the limit tied to the income derived from the particular business, still apply under the new option.

The new simplified option is available starting with the 2013 return most taxpayers file early in 2014. Further details on the new option can be found in Revenue Procedure 2013-13, posted today on IRS.gov. Revenue Procedure 2013-13 is effective for taxable years beginning on or after January 1, 2013, and the IRS welcomes public comment on this new option to improve it for tax year 2014 and later years. There are three ways to submit comments:

• E-mail to: Notice.Comments@irscounsel.treas.gov. Include "Rev. Proc. 2013-13" in the subject line.
• Mail to: Internal Revenue Service, CC:PA:LPD:PR (Rev. Proc. 2013-13), Room 5203, P.O. Box 7604, Ben Franklin Station, Washington, DC 20044.
• Hand deliver to: CC:PA:LPD:PR (Rev. Proc. 2013-13), Courier's Desk, Internal Revenue Service, 1111 Constitution Avenue NW, Washington, DC, between 8 a.m. and 4 p.m., Monday through Friday.

The deadline for comment is April 15, 2013.

January 14, 2013 — Filing Season Letter for Illinois Tax Professionals from IRS Stakeholder Liaison

Dear Illinois Tax Practitioner,

As the IRS Stakeholder Liaison area manager for Illinois, I want to thank you for your past support and ask for your continued partnership with your local stakeholder liaisons and me. SL is proud to be in our seventh year as the practitioners' gateway to the IRS.

We introduced the Issue Management Resolution System (IMRS) seven years ago and have received more than a thousand IMRS issues. Check out some of the successes in our IMRS report on IRS.gov.  Please continue to tell us when you see a problem or have a suggestion to improve our processes.

Redesigned www.irs.gov

Our website has been recently redesigned. The new platform will deliver what you need at a faster pace.  Highlights from the redesigned website include:

• Return to the home page from anywhere on the site by clicking on the IRS logo
• Find familiar headings (individuals, businesses, charities, etc.) by clicking on the down-arrow at "Information For" in the top right-hand corner
• Find a database listing of tax-exempt organizations, called "EO Select Check", under "Information For" Charities
• Find Resources for Tax Professionals all on one page
• Locate all our social media on our New Media page
• Search our new Third Party Reporting Information Center for guidance on Forms Series 1099, etc.
• Subscribe to our e-News Services.  All IRS subscriptions are sent from irs@service.govdelivery.com. PTIN reminders are also sent from this address. When in doubt about a link in an email, you can always go directly to www.irs.gov.

Keep up to date with RPO

Visit our Web page for PTIN Requirements for Tax Return Preparers to keep current on the rules and process your renewals. For additional PTIN information, contact the IRS Tax Professional PTIN Information line at 877-613-7846, available Monday-Friday, 8 a.m. - 5 p.m. CST.

How you can help your clients and colleagues

There are many ways you can assist us to further our partnership. Help us reach more practitioners by hosting joint events or webinars. Include IRS information in your newsletters or post an IRS tax center or web link on your website. You can even volunteer to teach a Small Business Tax Workshop in your community and share what you learn.

Finally, stay in touch with your local Stakeholder Liaison.  You may also contact me or if you need assistance in Illinois, contact an SL below.

Mike Mudroncik or Doug Blade	Theresa McGill or Emma Sanchez	Yolanda Ruiz
Phone: 312-292-3529 or 217- 862-6262	Phone: 630-493-5190 or 630-493-5265	Phone: 630-493-5194
Fax:	Fax:	Fax:
Email: michael.j.mudroncik@irs.gov or douglas.blade@irs.gov	Email: theresa.a.mcgill@irs.gov or emma.sanchez@irs.gov	Email: yolanda.ruiz@irs.gov

Filing season can be a challenging and stressful time, but together we can make it easier. Use our free tools, products and services; and raise your issues and concerns through your local stakeholder liaison.

January 9, 2013 — Announcement 2013-9: sets forth a correction to the Schedule of User Fees found in Appendix A of Revenue Procedure 2013-1

This announcement addresses a typographical error in the Schedule of User Fees found in Appendix A of Revenue Procedure 2013-1, 2013-1 I.R.B. 1, wherein the reduced user fee for a letter ruling, method or period change or closing agreement request involving a personal or business tax issue from a person with gross income of less than $250,000 was incorrectly listed as $1,000, when the correct reduced fee for this type of request is $2,000. Accordingly, the user fee associated with paragraph (4)(a) in Appendix A, Schedule of User Fees of Revenue Procedure 2013-1, 2013-1 I.R.B. 1, page 68, is $2,000.

The Service will provide relief for taxpayers who submitted ruling requests that otherwise meet the requirements for a reduced user fee under paragraph (4)(a) of Appendix A, Revenue Procedure 2013-1, accompanied by a fee of $1,000 in reliance on the erroneous information in Rev. Proc. 2013-1. For those taxpayers the Service will not require the payment of an additional $1,000. The Service will not, however, refund user fees to those taxpayers who submitted the correct fee of $2,000 with their initial filing. This relief applies only to requests received by the Service prior to February 1, 2013. For all such requests received on or after February 1, 2013, the correct user fee of $2,000 will be required.

The principal author of this announcement is Melissa A. Jarboe of the Office of Associate Chief Counsel (Procedure & Administration). For further information regarding this announcement contact Melissa A. Jarboe at (202) 622-3620 or George Bowden at (202) 622-3400 (not a toll-free call).

Announcement 2013-9 will appear in IRB 2013-14 on Jan. 22, 2013.

January 9, 2013 — Authorized IRS e-File Providers Must Not Submit Electronic Returns to the IRS Prior to Receipt of all Forms W-2, W-2G & 1099R from the Taxpayers

Authorized IRS e-file Providers must not submit electronic returns to the IRS prior to the receipt of all Forms W-2, W-2G, and 1099-R from the taxpayers.

If taxpayers are unable to secure and provide a correct Form W-2, W-2G, or 1099-R, Providers may submit the electronic return only after securing Form 4852, Substitute for Form W-2, Wage and Tax Statement, or Form 1099-R, Insurance Contracts, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs etc. in accordance with the use of that form. This is the only time Providers should submit an electronic return with information from pay stubs or Leave and Earning Statements (LES).

Compliance Monitoring

The IRS monitors Authorized IRS e-file Providers for compliance with this and other IRS e-file rules and requirements. The IRS may conduct monitoring visits to ensure compliance with Revenue Procedure 2007-40 and with IRS e-file rules and requirements included in IRS e-file publications.

Sanctions

The IRS may warn or sanction Providers that violate IRS e-file rules and requirements. Sanctions may be a written reprimand, suspension of one to two years or expulsion from participation from IRS e-file depending on the seriousness of the infraction. Providers may appeal sanctions through the Administrative Review Process. Additional information regarding sanctioning is available at IRS.gov in Publication 3112, IRS e-file Application and Participation.

January 8, 2013 — IR-2013-2: IRS Plans Jan. 30 Tax Season Opening For 1040 Filers

WASHINGTON — Following the January tax law changes made by Congress under the American Taxpayer Relief Act (ATRA), the Internal Revenue Service announced today it plans to open the 2013 filing season and begin processing individual income tax returns on Jan. 30.

The IRS will begin accepting tax returns on that date after updating forms and completing programming and testing of its processing systems. This will reflect the bulk of the late tax law changes enacted Jan. 2. The announcement means that the vast majority of tax filers — more than 120 million households — should be able to start filing tax returns starting Jan 30.

The IRS estimates that remaining households will be able to start filing in late February or into March because of the need for more extensive form and processing systems changes. This group includes people claiming residential energy credits, depreciation of property or general business credits. Most of those in this group file more complex tax returns and typically file closer to the April 15 deadline or obtain an extension.

"We have worked hard to open tax season as soon as possible," IRS Acting Commissioner Steven T. Miller said. "This date ensures we have the time we need to update and test our processing systems."

The IRS will not process paper tax returns before the anticipated Jan. 30 opening date. There is no advantage to filing on paper before the opening date, and taxpayers will receive their tax refunds much faster by using e-file with direct deposit. "The best option for taxpayers is to file electronically," Miller said.

The opening of the filing season follows passage by Congress of an extensive set of tax changes in ATRA on Jan. 1, 2013, with many affecting tax returns for 2012. While the IRS worked to anticipate the late tax law changes as much as possible, the final law required that the IRS update forms and instructions as well as make critical processing system adjustments before it can begin accepting tax returns.

The IRS originally planned to open electronic filing this year on Jan. 22; more than 80 percent of taxpayers filed electronically last year.

Who Can File Starting Jan. 30?

The IRS anticipates that the vast majority of all taxpayers can file starting Jan. 30, regardless of whether they file electronically or on paper. The IRS will be able to accept tax returns affected by the late Alternative Minimum Tax (AMT) patch as well as the three major "extender" provisions for people claiming the state and local sales tax deduction, higher education tuition and fees deduction and educator expenses deduction.

Who Can't File Until Later?

There are several forms affected by the late legislation that require more extensive programming and testing of IRS systems. The IRS hopes to begin accepting tax returns including these tax forms between late February and into March; a specific date will be announced in the near future.

The key forms that require more extensive programming changes include Form 5695 (Residential Energy Credits), Form 4562 (Depreciation and Amortization) and Form 3800 (General Business Credit). A full listing of the forms that won't be accepted until later is available on IRS.gov.

As part of this effort, the IRS will be working closely with the tax software industry and tax professional community to minimize delays and ensure as smooth a tax season as possible under the circumstances.

Updated information will be posted on IRS.gov.

January 3, 2013 — IR-2013-1: IRS Provides Updated Withholding Guidance for 2013

Notice 1036 will be updated on IRS.gov: www.irs.gov/pub/irs-pdf/n1036.pdf.

WASHINGTON — The Internal Revenue Service today released updated income-tax withholding tables for 2013 reflecting this week's changes by Congress.

The updated tables, issued today after President Obama signed the changes into law, show the new rates in effect for 2013 and supersede the tables issued on December 31, 2012. The newly revised version of Notice 1036 contains the percentage method income-tax withholding tables and related information that employers need to implement these changes.

In addition, employers should also begin withholding Social Security tax at the rate of 6.2 percent of wages paid following the expiration of the temporary two-percentage-point payroll tax cut in effect for 2011 and 2012. The payroll tax rates were not affected by this week's legislation.

Employers should start using the revised withholding tables and correct the amount of Social Security tax withheld as soon as possible in 2013, but not later than Feb. 15, 2013. For any Social Security tax under-withheld before that date, employers should make the appropriate adjustment in workers' pay as soon as possible, but not later than March 31, 2013.

Employers and payroll companies will handle the withholding changes, so workers typically won't need to take any additional action, such as filling out a new W-4 withholding form.

As always, however, the IRS urges workers to review their withholding every year and, if necessary, fill out a new W-4 and give it to their employer. For example, individuals and couples with multiple jobs, people who are having children, getting married, getting divorced or buying a home, and those who typically wind up with a balance due or large refund at the end of the year may want to consider submitting revised W-4 forms.

More information can be found on IRS.gov.

Modified: February 12, 2013